Dubai Double Tax Treaties

The United Arab Emirates is an attractive jurisdiction that is often used by foreign investors who want to take the advantages of the numerous double tax treaties — special agreements aimed at avoiding double taxation. Such bilateral agreements are signed between the UAE and many other countries.

The effect of the double tax treaties network extends to all the UAE companies that carry out their activities either on the territory of the country or abroad. The Emirate of Dubai offers the benefits of such agreements alongside with other competitive advantages.

Double tax treaties also apply to physical persons – residents of the country – who receive their interest and dividends from abroad. Such income can also be treated under beneficial provisions of the double tax treaties.

The availability of the Dubai double tax treaties network is a decisive factor for both foreign investors and natural persons that influences the choice of the Emirate for developing a profitable business or moving to the UAE for permanent residence.

Treaties on Double Taxation avoidance - Dubai and the UAE

The first double tax treaty was signed with France in 1989. As of today, almost 60 agreements are signed between Dubai and other countries from all parts of the world.

Double tax agreements serve as a legal basis for avoiding taxation of such incomes as:

Corporate tax;

Dividends received;

Interest income;

Royalties;

Income from real estate transactions.

Double tax treaties network signed by Dubai – main terms

Dubai double tax treaties are designed to develop economic relations between the UAE and its strategic partners on the international level. All the agreements have the same purpose; however, they may differ in particular provisions.

In general, the current double taxation agreements provide for the following advantages for private persons and legal entities:

Elimination of double taxation;

Lower tax rates for taxable income;

Tax-free government investments for both parties of the agreement;

Tax-free air and sea freight services.

According to the Dubai Tax Treaties Network, the taxes paid on the territory of the Emirate are not charged in the home country of a private person or legal entity. However, this and other provisions may vary depending on the particular double tax treaty and the applicable laws of the second party.

To be able to quality for the benefits of the double tax treaties companies and physical persons, living in Dubai, the UAE, may be required to obtain UAE tax Residency Certificate.

To get more information on how to register a company in the UAE or to become a resident of the UAE please get in touch with us.